ALTERA CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

YEARS ENDED

(In thousands)

December 31, 2014

December 31, 2013

December 31, 2012

Cash Flows from Operating Activities:

Net income

$

472,658

$

440,065

$

556,807

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

56,181

47,225

36,009

Amortization of  acquisition-related intangible assets

9,859

4,824

853

Amortization of debt discount and debt issuance costs

3,116

1,457

648

Stock-based compensation

93,432

96,624

93,586

Net gain on sale of available-for-sale securities

(140)

(153)

—

Amortization of investment discount/premium

2,746

3,407

—

Deferred income tax (benefit) expense

(3,329)

3,581

8,824

Tax effect of employee stock plans

4,946

7,009

9,811

Excess tax benefit from employee stock plans

(1,945)

(4,716)

(16,278)

Changes in assets and liabilities, net of the effects of acquisitions:

Accounts receivable, net

105,068

(157,842)

(91,435)

Inventories

10,493

(7,933)

(30,442)

Other assets

10,085

(1,309)

(3,698)

Accounts payable and other liabilities

14,756

9,414

(50,566)

Deferred income and allowances on sales to distributors

(143,578)

139,002

66,117

Income taxes payable

37,269

14,440

8,576

Deferred compensation plan obligations

(5,402)

(4,887)

(1,598)

Net cash provided by operating activities

666,215

590,208

587,214

Cash Flows from Investing Activities:

Purchases of property and equipment

(40,237)

(42,558)

(60,913)

Sales of deferred compensation plan securities, net

5,402

4,887

1,598

Purchases of available-for-sale securities

(905,283)

(1,347,626)

(921,430)

Proceeds from sale of available-for-sale securities

489,200

136,791

105,411

Proceeds from maturity of available-for-sale securities

191,498

178,221

115,373

Acquisitions, net of cash acquired

—

(145,321)

—

Purchases of intangible assets

(1,749)

(13,465)

(2,280)

Purchase of other investments

(10,224)

(7,441)

(4,935)

Net cash used in investing activities

(271,393)

(1,236,512)

(767,176)

Cash Flows from Financing Activities:

Proceeds from issuance of common stock through stock plans

47,123

58,220

49,665

Shares withheld for employee taxes

(22,890)

(28,272)

(31,472)

Payment of dividends to stockholders

(204,609)

(160,377)

(115,514)

Holdback payment for prior acquisition

(3,353)

—

—

Payment of debt assumed in acquisitions

—

(22,000)

—

Proceeds from issuance of long-term debt

—

991,786

500,000

Repayment of credit facility

—

—

(500,000)

Long-term debt and credit facility issuance costs

(1,321)

(4,143)

(5,244)

Repurchases of common stock

(654,508)

(201,095)

(229,057)

Excess tax benefit from employee stock plans

1,945

4,716

16,278

Net cash (used in) provided by financing activities

638,835

(315,344)

Net decrease in cash and cash equivalents

(442,791)

(7,469)

(495,306)

Cash and cash equivalents at beginning of period

2,869,158

2,876,627

3,371,933

Cash and cash equivalents at end of period

$

2,426,367

$

2,869,158

$

2,876,627

Supplemental cash flow information:

Income taxes (refunded)/paid, net

$

(3,305)

$

16,299

$

9,797

Interest paid

$

41,637

$

10,865

$

6,898